Bitcoin (BTC) maintained a new bullrun on Tuesday after a recurring stock market grabbed the largest cryptocurrency over $ 37,500.
Hourly candlestick chart BTC / USD (bit stamp). Source: TradingView.
The Fed may provoke new volatility
Data from Cointelegraph Markets Pro and TradingView showed BTC / USD trading above $ 36,000 on Tuesday, a 14% 24-hour gain from Monday’s lowest level.
The correlation between bitcoin and equities remained in the spotlight ahead of Wall Street’s new reopening and key interest rate information from the US Federal Reserve.
The Federal Reserve’s Federal Open Market Committee (FOMC) meeting is scheduled for Wednesday, and any interest rate news could have immediate implications for both traditional and crypto markets.
“Tomorrow’s Fed meeting could mean we see more volatility this week,” predicted Cointelegraph contributor Michael van de Poppe.
The rise in interest rates should be a continuation of the Fed’s declining asset purchases, with bitcoin sentiment weakening in advance as the end of light liquidity approaches.
The purchases of assets must be completed by March, and the Fed has said that the interest rate increase should not come before that date.
Mike McGlone, Chief Strategy Officer at Bloomberg Intelligence, summed up the hopeful prospects for BTC.
The correlations go 1 to 1.
BTC / USD correlation vs S&P 500 correlation chart. Source: Mike McGlone / Twitter.
Earlier this month, McGlone said bitcoin could recover stronger than equities when the long-awaited 20% correction occurs. Now he added that altcoins probably will not be able to make a comeback.
Large cryptocurrencies were wiped out earlier this autumn
As for altcoins, it performed well that day, with ether (ETH) equivalent to bitcoin.
Related: “Stop Panic Selling” – BTC Reserve BTC Whale Bag with low exchange balance
At the time of writing, the ETH / USD is up 7.3% to trade at $ 2,420, after reaching a low of $ 2,160, the worst since mid-July.
Hourly candlestick chart ETH / USD (bit stamp). Source: TradingView.
Some V-shaped recovery was also visible on other high-volume coins, including Binance Coin (BNB) and Solana (SOL).
“The good part is that we are getting closer and closer to the next altcoin peak as most of them have fully recovered,” van de Poppe argued ahead of the rally.